Canadian intelligence officials are worried the country is becoming a magnet for deadly terrorists thanks to overly lax immigration laws, a new report says.

“Canada’s immigration system, because it’s both open and accessible, is vulnerable to exploitation and abuse,” the Canadian Security Intelligence Service says in a report obtained by ABCNEWS.com.

Terrorists “appear to use Canadian residence as a safe haven, a means to raise funds, to plan or support overseas activities or as a way to obtain Canadian travel documents.”

Two alleged Algerian terrorists arrested last month after they crossed into Washington state and Vermont appear to have operated from Canadian bases. At the time, it was feared they were targeting U.S. sites, including possibly the Seattle Space Needle, for attack around New Year’s Day.

The CSIS says more than 50 terrorist groups and 350 individual terrorists are based in Canada.

Security experts say Canadian immigration officials are overwhelmed with work — and the country’s immigration process takes years to complete.

While officials process their paperwork, terrorists simply vanish from the immigration system, said Alan Bell, a Canadian security consultant.

“Then they’re free and easy, they’re in Canada, and they can do what the hell they like,” Bell said.

“Once a bad guy has dropped out of the immigration system or the refugee system, the chances of picking this guy up are very slim, unless they do something very stupid or wrong.”

The CSIS posted on its Web site last month a report calling Canada “inherently vulnerable to terrorism” because of its long coastlines and its border with the United States.

Since the arrests of Ahmed Ressam, who was detained Dec. 14 while carrying bomb-making materials in Washington, and Lucia Garofal, who was stopped for illegally crossing to Vermont five days later, Canada’s immigration laws have come under more criticism.

“We’re doing everything that we can, in terms of our work with immigration and citizenship, to prevent the abuses from happening,” CSIS spokesman Dan Lambert told